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Chapter 10: Problem 43

There are over 2 million Americans in prison. This tends to _____ the official unemployment rate. a) raise b) lower c) have no effect on

Short Answer

Expert verified
b) lower

Step by step solution

01

Defining Unemployment Rate

The unemployment rate is calculated by dividing the number of unemployed individuals by the total number of individuals in the labor force (i.e., those who are either employed or actively looking for work).
02

Understanding the Relationship Between Prison Population and Unemployment Rate

People who are in prison are not part of the labor force, as they are not actively seeking employment. Thus, they do not directly affect the unemployment rate calculation. However, if more people are in prison, there might be fewer people in the labor force. Less people in the labor force could lead to a lower unemployment rate, as there are fewer people overall to be considered 'unemployed.'
03

Selecting the Correct Answer

Considering the relationship between the prison population and unemployment rate explained above, the correct answer is b) lower. The large prison population removes people from the labor force, which could lead to a lower official unemployment rate.

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Most popular questions from this chapter

The rate of job creation during the administration of George W. Bush has been _____. a) relatively low b) relatively high c) about average

If the CPI rose from 160.5 in 1998 to 168.7 in 1999 to 173.4 in 2000, this would be an example of _____ a) deflation b) disinflation c) inflation

Which statement is true? \((\mathrm{LO4}, 5)\) a) Both liberals and conservatives feel that the official unemployment rate is too high. b) Both liberals and conservatives feel that the official unemployment rate is too low. c) The liberals believe that the official unemployment rate is too high, and the conservatives feel that it is too low. d) The conservatives feel that the official unemployment rate is too high, and the liberals feel that it is too low.

In recent years, which one of the following has tended to push up our natural unemployment rate? (LO5) a) Our increasing disability roles b) The quadrupling of our prison population c) The rapid growth of the temporary-help industry d) Growing worker insecurity e) The entry of millions of teenagers into the labor force

Which is the most accurate statement? \((\mathrm{LO4}, 8)\) a) The monthly rate of job creation during the administration of George W. Bush was faster than that during Bill Clinton's administration. b) We need to create about 150,000 new jobs every month to accommodate the people entering or reentering the labor force. c) Every year millions of American jobs are offshored. d) There are as many manufacturing jobs in the United States today as there were when George W. Bush became president.
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